I have lost count, but this seems like about the sixth time since the last Fed powwow that the Yellen (yellin’) wolfers have been rolled out to warn the punters. For Fed mucky muck Bill Dudley, generally considered a dove, this is the second time since the last meetup in July: “We’re edging closer toward the point in time where I think it will be appropriate to raise interest rates further,” says FRBNY President Bill Dudley in a TV interview, adding that a September move is possible.
Asked about asset bubbles, Dudley says the bond market is one that is looking “a little stretched” and chides those who make interest
rate bets for a living that they’re under-pricing the potential for rate hikes, blah, blah, blah.
Yellen wolf Atlanta Fed President Dennis Lockhart chimed in (again), saying two hikes in 2016 were a possibility. For those not keeping track, there are only three meetings left this year.
The stagflation is evident as well. Core CPI (ex food and energy) rose 2.2% YoY and remains above the Fed’s 2% mandate for the ninth straight month.
Despite the yellen wolf gesture, stocks and bonds barely sold off, and the odds of FOMC action on Sept. 21 rose to only 15% (from 9%). The U.S. dollar is acting weak and is testing support. The latest tabs on negative interest rates globally is $13.4 trillion. Even cabalist Lord Rothschild felt compelled to call this the “greatest monetary experiment in the history of the world.” Umh, thanks for finally checking in.
The speculative slingers and algos are daring the yellin wolves to make their day. Algos don’t believe yellen wolves, the wolves have no credibility. Go to any trader site and remarks like these are commonplace.